5 changes it could pay to be aware of in 2018

What legislation and other changes have been announced in recent months or are coming in 2018 that could affect your cash? We take a closer look.

1. Stamp duty scrap to benefit FTBs

If you’re looking to get on the property ladder, or helping your offspring get a home of their own, then stamp duty changes announced in the Autumn Budget will have been welcome news.

The tax was abolished in November 2017 for all properties up to £300,000 bought by first-time buyers, in a move that could see four out of five first-time homeowners saving up to £5,000.

Those buying in pricier housing markets, like London, will also benefit. The first £300,000 of purchases up to £500,000 will be stamp duty-free.

2. Income tax changes

From April, the personal allowance will rise to £11,850, while the 40% threshold rises to £46,350. Higher rate payers will be £340 a year better off after the changes, while basic rate payers will have £70 extra a year in their pockets.

3. Extra tax for some diesel cars

As part of moves to improve air quality, from April 2018 a one-band increase in first-year Vehicle Excise Duty (VED) will apply to new cars that don’t meet new driving emissions standards. With many new models not meeting the standards (it’s not mandatory until 2020), if you’re buying a new motor, it’s worth checking what the VED is, with some models seeing increases of up to £500 and others only costing £20 more.

4. Positive pension news

A small but significant change coming in April is the increase to the lifetime allowance for pensions to £1.03 million. Coming after a series of reductions, it’s good news for savers, particularly anyone who is nearing the limit.

In other good news for pensioners, those who reached the state pension age after 6 April 2015 could see their payments rise by 3% in April to £164.37 – an annual rise of up to £250.

5. More family homes removed from inheritance tax

In 2017, millions of family homes were removed from inheritance tax under new rules that saw people being able to claim an additional allowance of £100,000, on top of the £325,000 inheritance tax exemption, to offset the sale of the family home. In April 2018, this increases to £125,000.

However, the perk is only available if people are leaving their estate to their children or grandchildren.